The Securities and Exchange Commission (SEC) has granted a provisional “no-objection” to a proposal advocating for dollar-denominated listings on the Nigerian stock market. The proposal, championed by the Nigerian Exchange (NGX), involves the establishment of a novel listing platform designed for high-value issuers. This platform aims to enable companies and governments to raise capital through dollar-denominated debts and equity issuances.
In a bid to enhance the country’s foreign exchange (forex) reserves and explore alternate sources of capital, the proposal is considered a strategic move as it aims to redirect remittances and informal funds towards a formal market setting. By providing a platform for dollar-denominated listings, the initiative seeks to contribute to the nation’s forex position.
Mr. Lamido Yuguda, the Director-General of SEC, expressed the apex regulator’s support for the proposal, stating that the fundamental principle of regulation is full disclosure and the ability of an issuer to meet the required obligations associated with the issuance. He underscored that SEC would approach dollar-denominated listings by companies and governments based on their demonstrated capability to fulfill their obligations, as outlined in the issuance documents and in accordance with the prevailing rules of the capital market.
Yuguda emphasized that the core essence of regulation is to ensure transparency and accountability in the financial markets, with a focus on safeguarding investors’ interests and maintaining market integrity.
The provisional “no-objection” from SEC indicates a positive step toward expanding the options available to companies and governments seeking to raise capital on the stock market. This move aligns with efforts to diversify funding sources, attract foreign investment, and contribute to the overall growth of Nigeria’s economy.
As stakeholders in the financial and business sectors monitor the developments, the proposal’s potential impact on Nigeria’s forex position and the broader financial landscape is poised to be a topic of discussion among experts and industry players.
